Union Bank, Nigeria’s second oldest financial institution, reached a revenue milestone in 2021, with gross earnings for the year reaching an all-time high of N175 billion.

Union Bank of Nigeria Plc has released its audited financial statements for the year ended December 31, 2021 which reflects resilient revenue growth in the face of macroeconomic headwinds. The bank sustained steady performance as a result of increased customer engagement from an enhanced operating and go-to-market model and gains derived from our digital penetration strategy.

The financial highlights: Gross earnings: up 8.9percent to N175billion (N160.7billion in full year (FY) 2020), driven by strong non-interest income. Non-interest income: up 26.7percent to N55.7billion (N44billion in FY 2020) driven by significant increases in debt recoveries. Net operating income after impairments: down 3.6percent to N99.7billion (N103.4billion in FY 2020).

Profit before tax: down by 19.3percent to N20.5billion (N25.4billion in 2020). Operating expenses: marginally grew by 1.5percent to N79.1billion (N78billion in FY 2020), reflecting tight cost control despite inflationary pressures. Gross loans: up 22percent at N899.1billion (N736.7billion in December 2020) as Union Bank expand our lending to key economic sectors of opportunity. Customer deposits: up 20.4percent at N1.4trillion (N1.1 trillion in December 2020) as the bank continues to expand our product base and digital channels.

Emeka Okonkwo, CEO, Union Bank of Nigeria Plc 
Commenting on the results, Emeka Okonkwo, CEO, Union Bank of Nigeria Plc said: “Following an enhancement to our operating and go-to-market model to deliver better performance and efficiency leveraging our network across the regions, we are increasing our customer engagement and product penetration which is translating into higher customer revenues across geographies.

On the back of this, the Bank has continued to record headline growth by diversifying our income streams and accelerating our recoveries programme.”

“For the full year, our gross earnings grew by 8.9percent from N161billion to N175billion, while our net operating income after impairments dropped by 3.6percent to N99.7billion from N103.4billion. Interest income grew by 1percent as our earnings asset base expanded with a growing loan book.

“We continued our strong growth in non-interest income through a combination of aggressive recoveries, which grew 119percent in the period, from N7.2bn to N15.9billion and further growth in fee and commission income (33percent) and e-business (26percent).

These were delivered on the back of sustained multi-channel growth in users, volume and value across our digital and agent channels. Total active UnionMobile users now stands at 3.3 million, up 20percent while our Union360 customer base grew by 22percent to 26,400.

“In 2022, the Bank will continue to focus on broadening and deepening the strong foundations we have built, while enhancing our digital delivery platforms and service propositions to customers.

We remain deeply thankful to our erstwhile core investors, Union Global Partners and Atlas Mara who have been instrumental to our journey since 2012. Their invaluable support and expertise helped steer the Bank through turbulent waters and into an era of growth and stability.

“As we turn a new chapter for our Bank with a new core investor expected to come on board, we are proud of the solid foundation built over the last ten years and look forward to a seamless transition and continued successes in the future, ” the CEO stated.

Speaking on the FY 2021 numbers, Chief Financial Officer Joe Mbulu said: “We maintained very strong cost controls during the year despite the inflationary pressures and the translation effect of currency depreciation on our cost base.

Operating expenses increased marginally by 1.5percent with increasing regulatory, depreciation and amortisation costs. Customer deposits grew by 20percent while our loan book grew by 22percent from N736.7billion to N899.1billion, as we deepened support for key sectors in the economy.

We have been remained proactive in the way we manage our growing risk assets, maintaining our asset quality during the year with our NPL ratio growing marginally from 4percent to 4.3percent.”